News and analysis
August 20, 2010

Social Innovation Fund Process Stirs Controversy

A prominent nonprofit expert has stirred up a controversy about the Social Innovation Fund grants that were awarded last month, charging the federal government with "stonewalling" and possibly favoring a weak candidate that had lobbied to create the new fund.

However, the Corporation for National and Community Service denied it had acted improperly, outlining a process that moved groups forward only if they passed scrutiny at three levels of review.

Paul Light, professor of public service at New York University who served as a reviewer in the first phase of the selection process, complains that the fund has not released enough information about applicants or the process for selecting the winners.

"SIF is not a secret agency and these are not national security grants," Mr. Light wrote on his Washington Post blog.

In his most explosive charge, he said one organization that got a low rating from his panel ended up winning a grant.

"Given the applicant's impressive lobbying effort on behalf of SIF, its success raises inevitable questions about fairness, conflicts of interest, and undue pressure."

"The longer SIF keeps its records closed, the more the controversy will build," he wrote. (Mr. Light declines to name the organization.) He said he worries the fund will attract the attention of Congressional watchdogs like Senator Charles E. Grassley, Republican of Iowa.

Marta Urquilla, senior adviser for social innovation at the national-service agency, said reviewers on one committee do not see the whole selection process. She said that applicants in the first phase were reviewed by two committees. In three cases, presumably including Mr. Light's example, one committee rated the application "weak and unresponsive" and the other rated it "excellent."

The corporation decided to move those forward to the next phase since "our commitment was to surfacing the most compelling ideas," Ms. Urquilla said.

Any concerns that were raised by early reviewers were passed on and the finalists were asked to address them in a "clarification phase," she said.

Other nonprofit experts have criticized the national-service agency for failing to release more information about the grants process, such as a description of all of the applications—something the Education Department has done with its Promise Neighborhoods and Investing in Innovation grants programs.

The corporation says it cannot do that because it did not tell applicants in advance their materials would be public, but it is considering whether to make the process more open next year.

Ashley Etienne, an agency spokeswoman, said the corporation urged unsuccessful candidates to release their applications when it wrote to tell them they had not won grants.

The agency plans to post all of the winning applications, however, after the grantees get a chance to edit out proprietary information, Ms. Urquilla said.

Another reviewer for the fund came to the agency's defense. Steven H. Goldberg, author of Billions of Drops in Millions of Buckets, a book about philanthropy, accused Mr. Light of "inflammatory rhetoric and eager leaps to speculative conclusions."

"Even with its tiny size, SIF represents an important and courageous experiment by a forward-thinking administration," he wrote in the comments section of Mr. Light's blog.